Morning News Call - India, September 7

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FACTORS TO WATCH
10:00 am: Prime Minister Narendra Modi to inaugurate Global Mobility Summit
in New Delhi.
10:00 am: IRDAI Chairman Subhash Chandra Khuntia at Global Insurance Summit
in Mumbai.
5:00 pm: RBI to release weekly foreign exchange data in Mumbai.
LIVECHAT - GLOBAL ASSETS ALLOCATION SHIFTS
Reuters correspondent Claire Milhench details the findings of the latest
Reuters polling of global asset managers at 6:30 pm IST. To join the
conversation, click on the link: here
INDIA TOP NEWS
• Indian rupee breaches 72 to the dollar, markets worry over mild RBI
intervention
The Indian rupee fell sharply against the dollar on Thursday, despite gains
by other Asian peers, as investors worried about the pace of its fall and a lack
of strong intervention by the Reserve Bank of India (RBI).
• Opposition calls nationwide protests to take on Modi over fuel prices
India's opposition will launch nationwide strikes and protests next week
over record-high fuel prices, looking to tap rising public anger to hit back at
Prime Minister Narendra Modi ahead of a series of elections.
• POLL-Indian rupee to languish around 70 per dollar a year from now
India's battered rupee, which has lost more than 12 percent this year, will
hover near record lows on a worsening trade balance and at best only pare some
of those losses in the coming 12 months, a Reuters poll found.
• Jet Airways addressing salary delays, says pilots union
Jet Airways is in talks with its pilots to address delays in salary payments
and other matters, its pilots' union said on Thursday.
• U.S., India seal military communications pact, plan more exercises
India and the United States signed an accord on secure military
communications that both sides hailed as a breakthrough on Thursday, possibly
opening the way for sales of sensitive U.S. military equipment to India.
• Novartis unloads U.S. assets at loss to bargain-hunting Aurobindo
New Novartis Chief Executive Vas Narasimhan has further reshaped the Swiss
drugmaker, announcing on Thursday he is selling U.S. dermatology and generic
pill assets to India's Aurobindo Pharma for up to $1 billion.
• Nissan redraws India strategy, to focus on premium cars
Nissan Motor will produce and sell only premium vehicles in India, while
using its sister brand Datsun to crack the mass budget car market, in a revamp
of its strategy in the country, a company executive said on Thursday.
• India throws out ban on gay sex, but challenges remain
India's top court scrapped a colonial-era ban on gay sex on Thursday, in a
landmark judgement that sparked celebrations across India and elsewhere in South
Asia, where activists hope to push for similar reform.
GLOBAL TOP NEWS
• ANALYSIS-As next round of U.S. tariffs on China looms, both sides dig in
With U.S. President Donald Trump gearing up to impose tariffs on $200
billion in Chinese goods and Beijing certain to retaliate against any measures,
the world's two biggest economies are locked in an escalating trade war, with no
resolution in sight.
• U.S.-Canada trade talks grind on, but 'final' issues unresolved
U.S. and Canadian negotiators pushed ahead in grinding talks to rescue the
North American Free Trade Agreement on Thursday, but a few stubborn issues stood
in the way of a deal, including dairy quotas, protection for Canadian media
companies, and how to resolve future trade disputes.
• Japan household spending rebounds as wages rise, trade woes cloud outlook
Japan's household spending rebounded modestly in July as higher bonus
payments pushed up real wages, offering policymakers some hope a sustained
economic recovery and a tight job market are encouraging consumers to spend.
LOCAL MARKETS OUTLOOK
(As reported by NewsRise)
• SGX Nifty nearest-month futures were trading at 11,569.50, up 0.2 percent
from its previous close.
• The Indian rupee, following a string of record lows, is expected to
recover marginally against the dollar amid a further pullback in crude oil
prices.
• Indian government bonds will likely trade lower ahead of a fresh supply of
notes today, and the movement of the local currency will be keenly watched for
further cues. The yield on the benchmark 7.17 percent bond maturing in 2028 may
trade in 8.04 percent-8.10 percent band until the auction outcome today, a
dealer with a private bank said.
GLOBAL MARKETS
• The S&P 500 and Nasdaq declined on Thursday as the possibility of more
U.S. tariffs on Chinese imports loomed, while tech stocks stumbled, led by
chipmakers and concerns about increased regulation of social media companies.
• Asian shares slipped to a 14-month trough as investors feared a new round
of Sino-U.S. tariffs could come at any moment, while a slump in U.S. chip stocks
rippled through the tech sector.
• The dollar slipped against the yen after a report suggested that Japan
would be the next country with which U.S. President Donald Trump will take up
trade issues.
• U.S. Treasury yields fell on Thursday on safety buying as stocks dropped
and as investors saw recent weakness in bonds driven by heavy corporate issuance
as an opportunity to add positions at higher yields.
• Oil prices rose after U.S. crude inventories fell to their lowest levels
since February 2015.
• Gold rose as the dollar fell against the yen on fears that U.S. President
Donald Trump would take up trade issues with Japan as the markets braced for
another round of U.S. tarriffs on China.
CLOSE FII INVESTMENTS EQUITIES DEBT
PNDF spot 71.95/71.98 September 6 -$63.25 mln -$80.66 mln
10-yr bond yield 8.1 pct Month-to-date $386.43 mln -$586.72 mln
Year-to-date -$471.03 mln -$5.73 bln
For additional data:
India govt bond market volumes
Stock market reports
Non-deliverable forwards data
Corporate debt stories [IN CORPD]
Local market closing/intraday levels [IN SNAPSHOT]
Monthly inflows [INFLOWS RTRS TABLE IN]
($1 = 71.94 Indian rupees)
(Compiled by Benny Thomas in Bengaluru)